Current Issue

Ramon Fernandez has given coded criticism of Altice's "extremely aggressive" content strategy and said Orange would not "pay extremely high prices for products that do not necessarily make a difference".

The France-based operator’s Chief Financial and Strategy Officer made the comments in a wide-ranging discussion with journalists in Paris on Tuesday that also touched on Orange Bank, M&A and the company’s share in BT.

Responding to questions from European Communications about Orange’s content strategy, Fernandez said the operator was spending more than €600 million a year on film, TV and video offerings.

“It’s an area we are working on without participating in a game that is probably going to be extremely costly,” he added.

Fernandez rebuffed the notion that as the man holding the purse strings he was a sceptic holding back on a wider desire within Orange to do more in the content space.

“There are other people in the group sharing the same view,” he said.

Content is just one area in which Orange is investing as it looks to drum up new revenue streams.

In 2015, the operator committed itself to finding €1 billion in revenues from mobile financial services and the Internet of Things by 2018.

Fernandez said he expected mobile financial services would slightly outperform a target of €400 million in new revenues over the period, while revenues from the IoT would come in slightly under target.

He did not specify why IoT services are expected to underperform.

With the launch of Orange Bank just six weeks away, Fernandez said it would take five to six years for the new venture to break even and six to seven years to reach its target of two million customers.

On wider consolidation efforts in the industry, Fernandez said: “There is a view that in-market consolidation would accelerate pan-market consolidation. I think this is wrong, I think it’s the opposite.”

He added that pan-European, virtualised networks and EU-wide regulation for spectrum may change the game but that this prospect was “very, very far away”.

Asked about Orange’s four percent stake in BT, Fernandez said there was “no urgency” to sell its shareholding.

Finally, the CFO said Orange was ahead of schedule on its cost saving plans.

Fernandez claimed the company was 56 percent of the way along to making €3 billion of gross savings by 2020.